Brews to Barns Act Would Pay Brewers 8 Cents a Pound for Spent Grain

Brewers would earn an 8-cent credit per dry pound of spent grain they donate for agricultural use under the Brews to Barns Act, a bipartisan House bill introduced this week, with the credit capped at $35,000 per brewery per calendar year.

The credit applies against the federal excise tax on beer. To qualify, a brewer must contribute or gift the spent grain byproduct for local agricultural use during the calendar year. The bill spells out four allowed uses: animal feed, composting, soil amendment, and mushroom cultivation.

Rep. Mike Kelly (R-Pa.), the bill's lead sponsor and co-chair of the House Small Brewers Caucus, assembled a bipartisan roster. Co-sponsors include House Agriculture Committee Chairman Glenn "GT" Thompson (R-Pa.), Rep. Brad Schneider (D-Ill.), Rep. Jeff Hurd (R-Colo.), Rep. John Larson (D-Conn.), Rep. Josh Riley (D-N.Y.), and Rep. Strickland (D-Wash.), who co-chairs the Small Brewers Caucus alongside Kelly.

Spent grain is a major byproduct of brewing and distilling, and livestock feed is already among its most common destinations. The bill's backers frame it as a way to formalize and reward a supply chain that largely exists informally today.

What does the credit change for farmers?

For livestock producers, the practical appeal is feed cost relief. Thompson tied the measure directly to farm margins: "Across the commonwealth, brewers continue to create partnerships with local farmers and ranchers to put their spent grain to use in agricultural production," he said. "The Brews to Barns Act will provide key incentives to build upon that relationship, helping lower input costs for producers while supporting local small businesses."

Kelly cast the transaction as a two-way street between small businesses. "At their cores, local breweries and farms are small businesses who play integral roles in our communities," he said. "The Brews to Barns Act incentivizes a collaborative effort between small breweries and local farmers to strengthen local supply chains. It's a win-win for everyone."

Schneider pointed to the cost environment squeezing both sides of the exchange: "Everyone in America — from working families to Main Street businesses — is feeling the bite of rising costs," he said. "Among those hit hardest are craft beer brewers and local farmers, which is why I am glad to join my colleagues in this bipartisan effort to help lower costs and prevent waste."

Strickland added a landfill-diversion angle: "This tax credit for donating spent grain will lower costs for small brewers, benefit our local farmers and ranchers and keep spent grain out of our landfills," she said. "This bill is a commonsense way to lower the cost of doing business while supporting small brewers that boost our local economies."

Industry backing

The Boulder-based Brewers Association, the craft industry's main trade group, endorsed the bill. "By donating spent grain for agricultural use, brewers help turn a byproduct of the brewing process into a valuable resource for farmers," said Bart Watson, the association's president and CEO. "The Brews to Barns Act recognizes the value of these longstanding partnerships and helps ensure they can continue to thrive. We appreciate Reps. Kelly and Schneider's leadership in supporting the connections between America's brewers and farmers."

The bill text is now public, and its next test is committee referral and scoring — where the 8-cent rate and the $35,000 cap will face scrutiny against actual volumes of grain moved and the excise tax brewers actually owe.